The National Audit Office has once again demonstrated that when you look for savings in organizations that don’t ordinarily use cash as a measure of money, it gets very complicated. CSR07 savings were supposed to be cashable, that is, barrow loads of crisp fivers should have been pushed across Whitehall from the MoD and the other spending departments to the Treasury for safe keeping (ie giving to RBS). Instead, the Treasury received a load of dodgy cheques, IOU’s written on Portcullis House paper napkins, swapsies of permanent sec’s best conkers, etc.The surprise is that anyone is surprised. Tax credits, the Building Schools for the Future programme, Carbon Swaps and CSR cashable savings all share a labyrinthine complexity that we have come to associate with that power house of economic expertise that is the Treasury. According to the NAO full report: “The proportion of savings which do not meet those criteria (ie were real cash) is evidence that the Programme was not well enough understood across government and of insufficient quality control within departments before savings were reported publicly.” “Few of the savings made under the Programme represent major departures from previous practice. The Programme did not create sufficient incentive for departments to make wider improvements to value for money, or to reduce their costs.”Actually, I think that the NAO is guilty of flawed logic in identifying the wrong cause. Not making savings is not necessarily explained by a misunderstanding of the rules. A more plausible explanation is that the spending departments’ Oxbridge arts graduates understood exactly what the Treasury’s Oxbridge arts graduates wanted; but, that they chose to work the system, judging, to paraphrase the NAO, there was no mileage in making savings in CSR07 when CSR10 was obviously going to be harder.I would summarise the recommendations of the NAO; but, it is something of a national embarrassment that the NAO has to tell departments that they “will need to plan systematically for cost reduction”. Really?So, what can we learn that is relevant to the next round? Keeping it simple would seem to be the main idea. For instance, the Treasury could take on St Bob Geldof as its Spending Department Liaison Officer, since he has a way with words when it comes to cash (although I think his degree is from TCD so he may not pass the interview).
